US-China sign historic “phase one” of trade deal

President Donald Trump signed a partial trade deal with China on Wednesday as the world’s two largest economies try to contain an economic struggle.

Through the deal, the Trump administration aims to resolve some longstanding American concerns about Chinese trade abuses. However, the accord appears to leave questions about how Washington and Beijing will enforce its terms and prevent further tensions.

The deal takes steps to root out several practices that irked the White House and bipartisan members of Congress, including intellectual property theft and forced technology transfers, in exchange for Chinese market access, according to text released by the White House. It also details a $200 billion increase in Chinese purchases of U.S. goods over two years — a priority for Trump.

The president said the U.S. and China are “righting the wrongs of the past and delivering a future of economic justice and security for American workers, farmers and families.” He added that the deal has “total and full enforceability.”

The president signed the deal as the House prepared to send articles of impeachment to the Senate and kick-start a trial on whether to convict Trump and remove him from office.

Here are some of the deal’s core pieces (read the full agreement here):

  • It calls for China to submit an “Action Plan to strengthen intellectual property protection” within 30 days of the agreement taking effect, according to the trade pact. The proposal would include “measures that China will take to implement its obligations” and “the date by which each measure will go into effect.”
  • The deal says companies should be able to operate “without any force or pressure from the other Party to transfer their technology to persons of the other Party.” Technology transfers “must be based on market terms that are voluntary and reflect mutual agreement,” it reads.
  • The agreement says China will increase purchases of U.S. manufacturing, energy and agricultural goods and services by at least $200 billion over two years.
  • It makes commitments to try to root out the sale of counterfeit goods.
  • The deal includes provisions to boost Chinese market access to financial services firms.
  • Ahead of the signing, the Trump administration also revoked its decision to label China a currency manipulator.

U.S. stocks rose Wednesday before the deal signing. Trump signed off on the agreement after lengthy remarks dishing on impeachment, golf, his 2016 victory, stock market gains, the Federal Reserve’s interest rate policy and July 4 fireworks. (Courtesy CNBC)

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